Minnesota Department of Transportation officials said in memorandum filed in U.S. District Court Tuesday that a lawsuit seeking to halt approach work for the St. Croix Crossing project has “no merit” and that suspension of the work for a few months could delay completion up to two years and increase the project’s cost by millions.

MnDOT says lawsuit could delay St. Croix bridge

Construction crews are working on a construction staging area for the new St. Croix River Crossing. Minnesota Department of Transportation officials say the project is moving ahead despite a federal lawsuit seeking to halt work while a bidding dispute is resolved. (Staff Photo: Bill Klotz)

McCrossan suit has ‘no merit,’ agency says in filing

Minnesota Department of Transportation officials said in a memorandum filed in U.S. District Court Tuesday that a lawsuit seeking to halt approach work for the St. Croix Crossing project has “no merit” and that suspension of the work for a few months could delay completion up to two years and increase the project’s cost by millions.

The department’s court filing also said that Maple Grove-based contractor C.S. McCrossan, which filed the lawsuit, has “not demonstrated any likelihood of prevailing.”

On Tuesday, the deadline for responding to McCrossan’s motion for a temporary restraining order, MnDOT filed a memorandum in opposition to the motion, and affidavits from attorney Erik Johnson and MnDOT employees Jon Chiglo, Susan Mulvihill, Andrea Robinson and Mary Prescott.

The joint venture of Ames Construction and Lunda Construction, which has been awarded the contract by MnDOT, also filed a memorandum opposition McCrossan’s motion. Several affidavits from employees of the firms were also filed.

It was the latest development in a legal battle that started last week when McCrossan sued MnDOT, alleging it was unfairly removed from the nearly $60 million project, which includes realignment of Highways 36 and 95, part of the $626.4 million St. Croix Crossing project.

The department says work under that contract will begin the week of May 6. “We are moving ahead on the project,” MnDOT spokesman Kevin Gutknecht said Tuesday.

As of Tuesday, no date had been set for a hearing on McCrossan’s motion for a temporary restraining order to halt work on the $60 million project.

McCrossan President Tom McCrossan said in an interview Tuesday that the judge could schedule a hearing, make a ruling, or do “something in between.” By Thursday or Friday, “we should know what direction we are going,” McCrossan said.

In February, McCrossan had the low bid and the best technical score for the approach project, but MnDOT later rejected the bid on the grounds that McCrossan didn’t meet “good faith effort” requirements for inclusion of disadvantaged business enterprises.

The $58.1 million bid from the Lunda/Ames was nearly $6 million more than McCrossan’s, but MnDOT said Lunda/Ames was able to meet the project’s 16.7 percent goal for DBE participation.

McCrossan committed to 10.69 percent, but wanted more time to work on the goal.

Besides the temporary restraining order, McCrossan is asking the courts to order MnDOT to rebid the project, or “refrain from awarding it to anyone other than McCrossan,” and is seeking compensation to recover its bid preparation costs.

“Our point from the beginning is that we believe MnDOT erred in what it did, and it’s going to cost the taxpayers of Minnesota an additional $6 million,” McCrossan said. “We are doing our best to prevent that.”

MnDOT is making a similar case.

MnDOT project manager Jon Chiglo said in an affidavit filed Tuesday that a 14-day suspension of work would likely increase the project’s cost by $342,060 and that a 30-day delay would push the project into the next construction season, delay completion until April or May 2015, and increase costs by roughly $2.1 million.

A 180-day work suspension would increase costs by $6 million, but it’s “highly likely that the state would cancel the Lunda/Ames contract in favor of the public interest” before it reaches that point, Chiglo said in the filing.

Chiglo also said in the affidavit that Lunda/Ames would “likely be entitled” to nearly $5.4 million in compensation if the contract had to be canceled after a 180-day delay.

If the project had to be rebid and delayed until 2015, McCrossan’s $52.3 million bid would likely rise to $54.09 million, assuming 4 percent increases in labor and material costs, Chiglo said in the affidavit.

McCrossan says it should have been given more time to work on DBE goals because the project is a design-build effort. DBE procurement is more straightforward with traditional projects that are fully designed before bidding takes place, McCrossan says.

McCrossan also argued that MnDOT illegally treated the project’s DBE goal as a quota.

Two of the affidavits from MnDOT employees filed Tuesday responded directly to those arguments.

MnDOT employee Susan Mulvihill said in a filing that whether the project is design-build or design-bid-build, there’s “no question” that the U.S. Department of Transportation uses the same method to determine “good faith efforts” to meet DBE goals.

Another MnDOT employee, Andrea Robinson, said in an affidavit that she encouraged McCrossan to “do everything it could to meet the DBE participation goal,” but did not say that McCrossan “needed to meet the DBE participation goal to be awarded the project.”

Also on Tuesday, separate affidavits were filed by three employees of Ames Construction, and by an attorney representing the Lunda/Ames joint venture.

Richard Fahland, vice president of design-build for Ames Construction, said in an affidavit that the project was 35 percent to 40 percent designed at the time of bidding, and that it was able to obtain “meaningful prices and bids from potential subcontractors.”

Another Ames employee, Martin Husnik, said in an affidavit that Ames and Lunda faxed invitations to approved DBE subcontractors, published ads in local newspapers, and divided work into separate bid packages, among other things, as part of its good faith effort.

Ron Ames, senior vice president of Ames Construction, said in an affidavit that the project’s design-build project delivery method “did not affect or impair our ability to solicit and obtain commitments” from DBE firms.

As the legal process plays out, work on the project continues.

Some of the work under the Ames/Lunda contract is set to begin next week. The work includes clearing property in a former residential area adjacent to Highway 95 in Oak Park Heights.

Crews still have to cut down some trees, clear the land and get it ready for the new road alignment, according to MnDOT spokeswoman Mary McFarland Brooks.

Meanwhile, MnDOT said Monday that work has already started on a construction staging area, tasks that fall under a $36.73 million foundation contract with Wisconsin-based Edward Kraemer & Sons.

The work includes construction of dock walls to support equipment access for construction of bridge foundations in the river, and installation of steel sheet panels to provide docking facilities for barges, according to a MnDOT press release.

McFarland Brooks likens it to building a “concrete driveway” so crews can get their trucks and cranes to the barges.

Under terms of the contract, the Highway 95 approach work has to be completed by the end of the construction year, McFarland Brooks said. A ceremonial groundbreaking for the project will take place May 28, she said.